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Information Gathering and Processing in Retailing Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as

Information Gathering and Processing in Retailing

Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

RETAIL MANAGEMENT: A STRATEGIC APPROACH
RETAIL
MANAGEMENT:
A STRATEGIC
APPROACH

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Information and the Supplier Information and the Retailer Information and the Consumer Retail Mgt. 11e (c)
Information and the Supplier Information and the Retailer Information and the Consumer
Information
and the
Supplier
Information
and the
Retailer
Information
and the
Consumer

Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

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Suppliers Need To Know

FromFrom thethe RetailerRetailer

  • v Estimates of category sales

  • v Inventory turnover rates

  • v Feedback on competitors

  • v Level of customer returns

FromFrom thethe CustomerCustomer

  • v Attitudes toward styles and models

  • v Extent of brand loyalty

  • v Willingness to pay a premium for superior quality

Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

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Retailers Need To Know

FromFrom thethe Supplier Supplier

  • v Advance notice of new models and model changes

  • v Training materials

  • v Sales forecasts

  • v Justifications for price changes

FromFrom thethe CustomerCustomer

  • v Why people shop there

  • v Customers’ likes and dislikes

  • v Where else people shop

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Consumers Need To Know

FromFrom thethe Supplier Supplier

  • v Assembly and operating instructions

  • v Extent of warranty coverage

  • v Where to send a complaint

FromFrom thethe RetailerRetailer

  • v Where specific merchandise is stocked in the store

  • v Methods of payment acceptable

  • v Rain check and other policies

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RetailRetail Information

Information SystemSystem (RIS)(RIS)

  • v Anticipates the information needs of retail managers

  • v Collects, organizes, and stores relevant data on a continuous basis

  • v Directs the flow of information to the proper decision makers

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Figure 8-2: A Retail Information System

Figure 8-2: A Retail Information System Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as

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Data-BaseData-Base Management Management

vA major element in an RIS

  • v System gathers, integrates, applies, and stores information in related subject areas

  • v Used for

Frequent shopper programs

Customer analysis

Promotion evaluation

Inventory planning

Trading area analysis

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FiveFive StepsSteps toto Approaching

Approaching Data-BaseData-Base Management

Management

  • v Plan the particular data base and its components and determine information needs

  • v Acquire the necessary information

  • v Retain the information in a usable and accessible format

  • v Update the data base regularly to reflect changing demographics, recent purchases, etc.

  • v Analyze the data base to determine strengths and weaknesses

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Figure 8-4: Data-Base Management in

Action

Figure 8-4: Data-Base Management in Action Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as

Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

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Figure 8-5: Data Warehousing

Figure 8-5: Data Warehousing Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

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Components of a Data Warehouse

  • v Physical storage location for data – the warehouse

  • v Software to copy original databases and transfer them to warehouse

  • v Interactive software to allow processing of inquiries

vA directory for the categories of information kept in the warehouse

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DataData MiningMining andand Micromarketing Micromarketing

  • v Data mining is the in-depth analysis of information to gain specific insights about customers, product categories, vendors, etc.

  • v Micromarketing is an application of data mining whereby retailers use differentiated marketing and develop focused retail strategy mixes for specific customer segments

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Figure 8-6: Applying UPC Technology to

Gain Better Information

Figure 8-6: Applying UPC Technology to Gain Better Information Retail Mgt. 11e (c) 2010 Pearson Education,
Figure 8-6: Applying UPC Technology to Gain Better Information Retail Mgt. 11e (c) 2010 Pearson Education,

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Figure 8-7: The Marketing Research Process

Figure 8-7: The Marketing Research Process Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as

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MarketingMarketing ResearchResearch

inin RetailingRetailing

The collection and analysis of information relating to

specific issues or problems facing a retailer

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Secondary Secondary DataData

Advantages

Advantages

  • v Inexpensive

  • v Fast

  • v Several sources and perspectives

  • v Generally credible

  • v Provides background information

Disadvantages

Disadvantages

  • v May not suit current study

  • v May be incomplete

  • v May be dated

  • v May not be accurate or credible

  • v May suffer from poor collection techniques

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Secondary DataData SourcesSources

Secondary

InternalInternal

  • v Sales reports

  • v Billing reports

  • v Inventory records

  • v Performance reports

ExternalExternal

  • v Data bases

Academic Search Premier

Government

U.S. Census of Retail Trade

Statistical Abstract of the U.S.

Public records

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Primary Data

Advantages

Advantages

  • v Collected for specific purpose

  • v Current

  • v Relevant

  • v Known and controlled source

Disadvantages

Disadvantages

  • v May be more expensive

  • v Tends to be more time consuming

  • v Information may not be acquired

  • v Limited perspectives

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PrimaryPrimary DataData DecisionsDecisions

In-house or outsource? Sampling method?

Probability

Non-probability

Data collection method?

Survey

Observation

Experiment

Simulation

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SurveySurvey MethodsMethods

  • v In person

  • v Over the telephone

  • v By mail

  • v Online

  • v Disguised

  • v Non-disguised

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Figure 8-9: A Semantic Differential for Two Furniture Stores

Figure 8-9: A Semantic Differential for Two Furniture Stores Retail Mgt. 11e (c) 2010 Pearson Education,

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MysteryMystery Shoppers

Shoppers

  • v Retailers hire people to pose as customers in order to evaluate aspects of the store environment (e.g. sales presentations, display maintenance, and service calls)

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Experiments

Experiments

  • v An experiment is a research method in which one or more elements of a retail strategy mix are manipulated under controlled conditions.

q

An element may be a price, a shelf display, store hours, etc.

q

If a retailer wants to find out the effects of a price change on a brand’s sales, only the price of that brand is varied.

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Simulation

Simulation

vA simulation is a type of experiment whereby a computer program is used to manipulate the elements of a retail strategy mix rather than test them in a real-life setting.

  • v Two simulation types are now being applied in retail settings: those based on mathematical models and those involving “virtual reality.”

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